30-Mar-2016: Liquidators' Update, see Deloitte site

UK News

This page contains brief summaries of and links to media reports on the topic of UK News.

Sigurdardottir Tells Brown Icesave Accord Isn’t Legally Binding

Nov. 26 (Bloomberg) -- Iceland’s Prime Minister Johanna Sigurdardottir has written to U.K. Prime Minister Gordon Brown, stating her opinion that an accord with the U.K. and Netherlands on depositor guarantees isn’t legally binding.

Following an amended agreement, from Oct. 19 Iceland agreed to reimburse U.K. and Dutch depositors of failed Landsbanki Island hf’s Icesave Internet accounts “without there being an unequivocal legal obligation to do so,” Sigurdardottir wrote in the letter to Brown, dated Nov. 17. The agreement still needs to be ratified by Iceland’s parliament. . . .

“If Iceland’s position were, at a later date in time, to be vindicated by a competent adjudicator, we would certainly expect the other parties to revisit the matter in a spirit of fairness and good faith,” Sigurdardottir wrote Brown. 26-Nov-09.

New Book: UK Tried to Close Landsbanki in August

According to a new book on the banking collapse in Iceland by former editor of Morgunbladid Styrmir Gunnarsson, Umsátrid – fall Íslands og endurreisn, the British Financial Supervisory Authority had threatened to stop Landsbanki’s operations in the UK in August 2008 if the Icesave deposits weren’t transferred into a British subsidiary.

In an effort to keep their operations in the UK going, Landsbanki’s executives requested a loan from the Central Bank of Iceland of GBP 2.5 billion (USD 4.2 billion, EUR 2.8 billion) . . .

Former Minister of Business Affairs Björgvin G. Sigurdsson has confirmed Gunnarsson’s story. He said he had discussed the matter with his British counterpart in early September and at that time a solution seemed to be in sight. 18-Nov-09.

Michael Foot publishes review of offshore financial centres

Mr Foot, the former managing director of the FSA, published his independent review of British offshore financial centres, which looked at the future sustainability of these jurisdictions and sets out a series of standards to which they must adhere

Although he did not spell out the kind of sanctions that might be enacted, Mr Foot said the process should be similar to the gradual pressure exerted by the G20 on tax havens. . .

The 93-page report states that British offshore financial centres must ensure they meet international standards on tax information exchange, financial regulation, anti-money laundering and financing of terrorism.

Most controversially tax havens must also ensure they put public finances on a firmer footing by diversifying their tax bases, making them less vulnerable to events like the current financial crisis.

The report also said the UK government should discuss with these offshore centres what its relationship and responsibilities will be to them in the future, including what financial assistance it will provide in times of crisis, and how their risks exposures will be managed.  29-Oct-09.

FSA under fire for lack of inquiry into Icelandic banks

The Financial Services Authority (FSA) will come under attack from MPs today for failing to carry out an inquiry after the collapse of Icelandic banks.

The Communities and Local Government Select Committee is furious that the FSA has chosen not to meet its demand for an investigation into losses suffered by local authorities with the banks.. .

Auditors have told councils that they can expect up to 80 per cent of the money back eventually, but no guarantees have been given and each Icelandic bank is operating separately. This means that at least £200 million is unlikely to be returned. The bulk of the cash — £630 million — went to Glitner Bank and Landsbanki, which have not started to process claims. 28-Oct-09.

Iceland Bank Collapse: 'FSA Failed To Act'

The former chief executive of one of Iceland's fallen banks has blamed regulators for the collapse of the country's financial system.

Tony Shearer ran the British-based bank Singer and Friedlander until it was taken-over by Iceland's Kaupthing in 2005.

He told Sky's Jeff Randall Live regulators failed to act on clear signs the Icelandic financial system was predicated on unprecedented levels of risk.

And he said it was "extraordinary" that the Financial Services Authority (FSA) did not do more to investigate the practices of Iceland's top banking executives.  26-Oct-09. . .

Iceland reaches savers' agreement

The Icelandic government says it has come to a new agreement with the governments of the Netherlands and the UK over the repaying of $5bn (£3bn) . . .

Iceland's Prime Minister Johanna Sigurdardottir said the government believed the new law would be adopted by parliament.

At a press conference, she said a review by the IMF of its $10bn bail-out programme would take place before the end of the month. . .

It does not cover the money British councils invested in Icelandic banks. They are engaged in a separate process to recover their money, led by the UK's Local Government Association. 18-Oct-09.

Britons 'in the frame' after SFO probes Icelandic banks fiasco

Serious Fraud Office investigators are flying home this weekend after sifting the wreckage of Iceland's financial system for evidence against UK firms and individuals.

It is understood the threestrong team have uncovered evidence that might lead to charges against former British clients of Iceland's collapsed banks. 'They made good progress,' said the SFO. 'Some very interesting information came out of their discussions with our Icelandic colleagues.'  18-Oct-09.

Spare a thought for offshore savers

They are the forgotten victims of the credit crunch — the people whom the Government has quietly filed in a box marked “ignore, no help required”. But help is exactly what they need. Thousands of savers who trusted their money to banks in the Isle of Man and Guernsey are still waiting to find out if they have lost a big chunk of their life savings. . .

Westminster’s refusal to grant compensation is understandable. In a Parliament obsessed with spending cuts, bailing out offshore savers is never going to be a priority. However, that does not mean that these victims should be abandoned. Pressure should be applied to the Isle of Man and Guernsey authorities to ensure that as much of their savings are returned as possible, as quickly as possible. To the Isle of Man’s credit, it does seem to be trying, but so far payouts from the island’s compensation scheme have been painfully slow.

However, even faint praise cannot be extended to the Guernsey authorities. Worried about the damage to the island’s reputation, it has belatedly introduced a hopelessly inadequate compensation scheme, but it is not open to the Landsbanki victims.  26-Sep-09.

Treasury fears over Icelandic bank debt

Britain has asked Iceland to spell out how it will repay the £2.3bn it cost to bail out UK savers amid concerns that a future Reykjavik government could seek to write off part of the debt. . .

The Government is seeking a guarantee from Reykjavik that 2024 will not mark a deadline on payments and that all the cash will be paid.

At the time of the collapse, with Iceland on the brink of economic meltdown, the UK and Dutch governments used their own money to compensate savers.  19-Sep-09.

Iceland banks' fraud trails 'lead to UK'

Leading Icelandic prosecutors met members of the Serious Fraud Office in London today , underlining the strong British dimension in mounting evidence of widespread and substantial frauds exposed in the Nordic nation's dramatic banking meltdown 11 months ago. . .

Hauksson said he already had 35 cases under investigation and expected the total to rapidly grow to between 60 and 70. Areas of inquiry include loan fraud, market manipulation, document fraud, embezzlement and bank fraud. . .

Also of concern to banking experts has been the large loan exposure of these banks to individuals, some of whom held an interest in the ownership of the banks. A mix of light loan collateral and a complex web of corporate cross-holdings made discovering true asset values in many cases near impossible.  11-Sep-09.

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